Eduardo Saverin Bill Backed By John Boehner

Luna Tick · May 22, 2012

Opteron said:
I don't think we should single out this individual. Its standard practice among the wealthy to avoid taxes as much as possible. Corporations ship jobs overseas, keep money tied up overseas. Apple outsources jobs to China while keeping billions in profits and has an office in Nevada to get out of taxes, probably has offices worldwide too to do the same. We need tax reform across the board and new policies to deal with these issues.

The bill doesn't single one person out. It's aimed at anyone who renounces citizenship to avoid taxes.

Opteron · May 22, 2012

Luna Tick said:
The bill doesn't single one person out. It's aimed at anyone who renounces citizenship to avoid taxes.

Ya I know, but the whole premise of the bill is based on this guy, I think and its probably news because of him. I guess that's ok to fix a problem if it needs fixing, but I don't think we should rail on this guy and then let corporations continue to claim global breaks and other rich people allow to put money in trusts, etc.

Luna Tick · May 22, 2012

Opteron said:
Ya I know, but the whole premise of the bill is based on this guy, I think and its probably news because of him. I guess that's ok to fix a problem if it needs fixing, but I don't think we should rail on this guy and then let corporations continue to claim global breaks and other rich people allow to put money in trusts, etc.

I agree this is a minor dirty trick compared to some robber baron activity out there. Do you get The Young Turks on the Current channel? Cenk Uygur has been covering crooked people who buy out a company to deliberately get big bonuses with no intention of keeping it running. Instead they drive it into bankruptcy, putting everyone out of work and walk away with their giant bonuses. It's criminal, or at least it should be.

Opteron · May 22, 2012

Luna Tick said:
I agree this is a minor dirty trick compared to some robber baron activity out there. Do you get The Young Turks on the Current channel? Cenk Uygur has been covering crooked people who buy out a company to deliberately get big bonuses with no intention of keeping it running. Instead they drive it into bankruptcy, putting everyone out of work and walk away with their giant bonuses. It's criminal, or at least it should be.

I get the Current channel, but I haven't watched it yet, its like channel 200 or something lol. That does sound criminal, almost fraudulent if they use other people's money. Did they use their own money to buy it out or did they lie to other people? Lot of the tax regulations need some fixing.

AdamT · May 22, 2012

washunut said:
Sorry if you felt that I was talking down to you. That being said, what you represent what I said shows you are either confused about what I said, or you just don't know the point I was making. I never said Buffett paid no taxes, I said he paid no taxes on his UNREALIZED gains in Berkshire stock he owns. Never said it was illegal either.

So what are you saying? You think that capital gains should be taxed before they're earned?

washunut · May 22, 2012

AdamT said:
So what are you saying? You think that capital gains should be taxed before they're earned?

Absolutely not. Just that the righteous indignation about tax rates from Buffett is B.S. I would feel a bit better about his position as a frontman for Obama if he was getting a fee that would go to Berkshire as I am an owner of some "B" shares.

AdamT · May 22, 2012

washunut said:
Absolutely not. Just that the righteous indignation about tax rates from Buffett is B.S. I would feel a bit better about his position as a frontman for Obama if he was getting a fee that would go to Berkshire as I am an owner of some "B" shares.

Interesting. Most investors would rather see the CEO of a company take a large equity stake so that his interests are aligned with shareholders' interests, as opposed to taking a large salary that drains working capital and reduces profits. It's definitely something I look for when buying stocks.

American · May 22, 2012

Luna Tick said:
I think it's great. The man used the United States to become successful and then discarded the country like garbage rather than pay is fair share. He originally came to the country as a refuge seeking protection. We gave him that. Now all he cares about is evading taxes. I think a bipartisan bill that bans him from ever coming here again is a great idea.

Are you saying he hasn't paid any taxes since he's been here? Did you know that he put in his paperwork to end his citizenship last yea?. And how about the 47% that live here and don't pay taxes? Is Congress going to pass a bill kicking them out too?

upsideguy · May 23, 2012

washunut said:
Perhaps we should banish Buffet from the country as well. While he has not taken up a different nationality, he has used his tax lawyers to insure that most of his billions will never be taxed, not a single dime. Take about a hypocrite.

I think you lack quite a bit of understanding on the Berkshire Hathaway tax issue, starting with the fact the Buffet owns less than 10% of the company and continuing with the fact that it is in dispute with the IRS on certain definitions. Americans have a defined right to minimize their taxes as long as they comply with the law. That is what Berkshire is doingl while Sauveran is choosing to slip out the back and not pay what is due.... a big difference.

Allow me to re-repost one of my earlier posts on this subject... just to illustrated you have made a very bad example of equivalence because you know not of what of what you speak

.....In the words of Spock, “Interesting!” This is a microcosm of what American politics have become in an era of the Internet (where anyone can post anything) and opinion marketed as news. Some guy that has no clue what he is taking about packages facts they do not understand, puts a spin on those facts designed to incite those that know even less about the subject than he then feeds those facts to people of ignorance hungry for something to support their preconceived ideas of the world. Anyone that takes this as some type of indictment of Buffett has been had.

Let's start with the simple items:
1. Berkshire Hathaway is a public corporation, not Buffett’s personal holding company.
a. Berkshire has 1,200 institutional holders. All of the insiders, including Buffett, collectively hold less than 14% of the business. They do not have control. In fact, Buffett isn’t even the largest holder of BH, the Bill Gates Foundation is. It has 3 times the number of shares of Buffett.
BRK-A Major Holders | Berkshire Hathaway Inc. Common Stock - Yahoo! Finance
b. As a public corporation, it has a duty to its shareholders to maximize shareholder value, usually through maximizing profits. A part of maximizing profits is minimizing tax (see discussion of deferred taxes).
2. All corporations have two sets of books.
a. Accounting for income taxes and accounting for shareholders (generally accepted accounting principles or GAAP) are different things. Often there are different rules about expense and revenue recognition. For example, the IRS allows for more aggressive write-offs of equipment (even expensing) then GAAP which requires they be depreciated over useful lives.
b. Companies seek to maximize book profit and minimize taxes, so they are far more aggressive on expense recognition on the tax books and less aggressive on the book books….
c. The IRS and GAAP each require an accounting of the reconciliation between book income and tax income. On the tax return, this is on schedule M-1. On the books, its called deferred tax accounting, which is usually found on the balance sheet with a very extensive explanatory footnote.
d. Illustration: If you had $100 in revenue, $40 in cost, you would have a $60 profit. At a 35% tax bracket, the tax would $20. However, if your bought a $40 computer and expensed that year for tax purposes (and over 5 years for book purposes) suddenly you have different results. The tax books would show $20 of taxable income and $7 in tax; the book books would show $52 in taxable income and $18.20 in tax.

So, given the company only paid $7.00 in taxes, but accrued $18.20, the difference is recorded as a deferred tax liability. They did not pay all of the tax associated with the profits of business, but elected to defer payment. This deferment can go on for years. This is the way every responsible company operates.
Of course, the above example is very basic. It gets a lot more complicated with international conglomerates such as BH, which does acquisitions and has holdings in insurance and railroads (very complex). The BH tax situation is very complex.

This brings us the assertion that BH is not paying its taxes.
Update: Warren Buffett’s Company Owes Nearly $1 Billion in Taxes | TheBlaze.com
What an absurdly naïve statement! Whoever came up with this knows zero about corporate finance and/or knows they play to an audience that knows even less. Let’s start with the assertion that they owe $1B in back taxes…. No, the deferred tax liability (taxes according to the books, that are not yet paid) is actually $35B, but there is not abnormal about that. The $1B being discussed in the article has NOTHING to do with taxes owed, in fact, unrecognized tax benefits are the opposite of owing money; it’s a potential tax liability offset (receivable), that because of accounting convention, is not on the books (just footnoted). See footnote 15 to the Berkshire Hathaway audited financial statements, which reconciles the company’s long-term and current deferred tax situation (between books and tax)

Then there is this whole dialogue about IRS audits. Again, this is silliness. A company with a that kind of balance sheet and a history of business acquisitions and divestitures, which give rise to very complex taxation events, has IRS auditors that practically reside in their offices. There are always going to be definitional disputes between the parties, and while these disputes often have big numbers associated with them, they are typically rounding errors in transactions and small components of the company's tax return. They are not material. You can read the footnotes of the financial statements of any Fortune 500 company and see a paragraph or mention of tax disputes. This is why we have tax courts because taxation is not as black and white as you think it is.

Sorry, but this whole thing is a bit analogous to someone looking at the balance sheet, seeing liabilities and yelling “hey, they aren’t paying their bills”
I appreciate the fact that people want to argue tax policy, and I further appreciate the fact that taxes are complex, maybe too complex, but people should use restraint and not talk authoritatively about things they knew little about.

Kreton · May 23, 2012

Hare said:
If Saverin's actions were within the realm of legality, he shouldn't be singled out by a piece of knee jerk legislation. Banning an individual from entering the United States over a personal grievance is downright foolish and an abuse of authority in my opinion.

In your opinion what should be done?

Tigger · May 23, 2012

I'm not so sure that I'm a big fan of legislation targeting one person. However, I WOULD be in favor of legislation banning ANYONE/EVERYONE who renounces their US Citizenship (for whatever reason) from ever entering the US again.

washunut · May 23, 2012

upsideguy said:
I think you lack quite a bit of understanding on the Berkshire Hathaway tax issue, starting with the fact the Buffet owns less than 10% of the company and continuing with the fact that it is in dispute with the IRS on certain definitions. Americans have a defined right to minimize their taxes as long as they comply with the law. That is what Berkshire is doingl while Sauveran is choosing to slip out the back and not pay what is due.... a big difference.

Allow me to re-repost one of my earlier posts on this subject... just to illustrated you have made a very bad example of equivalence because you know not of what of what you speak

.....In the words of Spock, “Interesting!” This is a microcosm of what American politics have become in an era of the Internet (where anyone can post anything) and opinion marketed as news. Some guy that has no clue what he is taking about packages facts they do not understand, puts a spin on those facts designed to incite those that know even less about the subject than he then feeds those facts to people of ignorance hungry for something to support their preconceived ideas of the world. Anyone that takes this as some type of indictment of Buffett has been had.

Let's start with the simple items:
1. Berkshire Hathaway is a public corporation, not Buffett’s personal holding company.
a. Berkshire has 1,200 institutional holders. All of the insiders, including Buffett, collectively hold less than 14% of the business. They do not have control. In fact, Buffett isn’t even the largest holder of BH, the Bill Gates Foundation is. It has 3 times the number of shares of Buffett.
BRK-A Major Holders | Berkshire Hathaway Inc. Common Stock - Yahoo! Finance
b. As a public corporation, it has a duty to its shareholders to maximize shareholder value, usually through maximizing profits. A part of maximizing profits is minimizing tax (see discussion of deferred taxes).
2. All corporations have two sets of books.
a. Accounting for income taxes and accounting for shareholders (generally accepted accounting principles or GAAP) are different things. Often there are different rules about expense and revenue recognition. For example, the IRS allows for more aggressive write-offs of equipment (even expensing) then GAAP which requires they be depreciated over useful lives.
b. Companies seek to maximize book profit and minimize taxes, so they are far more aggressive on expense recognition on the tax books and less aggressive on the book books….
c. The IRS and GAAP each require an accounting of the reconciliation between book income and tax income. On the tax return, this is on schedule M-1. On the books, its called deferred tax accounting, which is usually found on the balance sheet with a very extensive explanatory footnote.
d. Illustration: If you had $100 in revenue, $40 in cost, you would have a $60 profit. At a 35% tax bracket, the tax would $20. However, if your bought a $40 computer and expensed that year for tax purposes (and over 5 years for book purposes) suddenly you have different results. The tax books would show $20 of taxable income and $7 in tax; the book books would show $52 in taxable income and $18.20 in tax.

So, given the company only paid $7.00 in taxes, but accrued $18.20, the difference is recorded as a deferred tax liability. They did not pay all of the tax associated with the profits of business, but elected to defer payment. This deferment can go on for years. This is the way every responsible company operates.
Of course, the above example is very basic. It gets a lot more complicated with international conglomerates such as BH, which does acquisitions and has holdings in insurance and railroads (very complex). The BH tax situation is very complex.

This brings us the assertion that BH is not paying its taxes.
Update: Warren Buffett’s Company Owes Nearly $1 Billion in Taxes | TheBlaze.com
What an absurdly naïve statement! Whoever came up with this knows zero about corporate finance and/or knows they play to an audience that knows even less. Let’s start with the assertion that they owe $1B in back taxes…. No, the deferred tax liability (taxes according to the books, that are not yet paid) is actually $35B, but there is not abnormal about that. The $1B being discussed in the article has NOTHING to do with taxes owed, in fact, unrecognized tax benefits are the opposite of owing money; it’s a potential tax liability offset (receivable), that because of accounting convention, is not on the books (just footnoted). See footnote 15 to the Berkshire Hathaway audited financial statements, which reconciles the company’s long-term and current deferred tax situation (between books and tax)

Then there is this whole dialogue about IRS audits. Again, this is silliness. A company with a that kind of balance sheet and a history of business acquisitions and divestitures, which give rise to very complex taxation events, has IRS auditors that practically reside in their offices. There are always going to be definitional disputes between the parties, and while these disputes often have big numbers associated with them, they are typically rounding errors in transactions and small components of the company's tax return. They are not material. You can read the footnotes of the financial statements of any Fortune 500 company and see a paragraph or mention of tax disputes. This is why we have tax courts because taxation is not as black and white as you think it is.

Sorry, but this whole thing is a bit analogous to someone looking at the balance sheet, seeing liabilities and yelling “hey, they aren’t paying their bills”
I appreciate the fact that people want to argue tax policy, and I further appreciate the fact that taxes are complex, maybe too complex, but people should use restraint and not talk authoritatively about things they knew little about.

Sorry you misunderstood, I was not talking about BH not paying taxes. I do agree that everyone has the right to pay as little as possible.

Ahlevah · May 23, 2012

Tigger said:
I'm not so sure that I'm a big fan of legislation targeting one person. However, I WOULD be in favor of legislation banning ANYONE/EVERYONE who renounces their US Citizenship (for whatever reason) from ever entering the US again.

What a great message to send to (rich) entrepreneurs who are thinking of moving here to start businesses: "Make sure you really want to become an American, because if you change your mind, we'll sock you with a retroactive 30% tax on your worldwide capital gains, regardless of where you live, and bar you from ever entering the U.S. again if you don't pony up the dough. So be smart and move to some place like Singapore, instead, which has no capital gains tax and rolls out the red carpet for entrepreneurs. Bonus: Little crime, you can open an overseas bank account, and there are no welfare lumps to support, but you can still see the sights in America if you so choose."

Banishing Facebook's Eduardo Saverin Harms U.S. More - Forbes

MKULTRABOY · May 23, 2012

Dozens of billionaires dodging with cash in banks all over the world...

and this guy needs a special law written to deny him exit or re-entrance.

I want to write a law banning all stupid people from staying in the country...

Wake · May 24, 2012

MKULTRABOY said:
I want to write a law banning all stupid people from staying in the country...

You needn't have tested your dream in this forum.

Goodbye.

Wake · May 24, 2012

Luna Tick said:
Looks like this tax evading jerk will get banned from ever coming into the country. Both parties are in support. Good. If he needs to have an in-person meeting with other Facebook people or whatever, they'll have to do it in another country or on board a ship in international waters if this passes.

Full Story:
Eduardo Saverin Bill Backed By John Boehner

Personally I think that if you're an American, you should be paying taxes to fund out government, especially if you're obscenely wealthy.

You dare leave our country to save your taxes? You can forfeit your US passport for doing so.

X Factor · May 25, 2012

ChuckBerry said:
The Ex-PATRIOT act does not target a specific individual.

Sens. Chuck Schumer (D-N.Y.) and Bob Casey (D-Pa.) are unveiling the Ex-PATRIOT Act, which stands for "Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy," on Thursday. The bill would force anyone who "expatriates for a substantial tax purpose -- as judged by the Internal Revenue Service" to pay a mandatory 30 percent tax on future capital gains. The ex-citizens would also be turned back at the border if they ever tried to come back. (emphasis added)

Senators Go After Eduardo Saverin, Facebook Co-Founder, For Dumping U.S. Passport, Avoiding Taxes (UPDATE)

The IRS would make the judgment? **** that. Giving the IRS more power is the last thing we should ever do.

DaveFagan · May 25, 2012

Is this bill also going to go after the tax-dodging Corporations that moved their headquarters offshore to avoid taxes. If so, then they need to contact Dick Cheney of Haliburton fame and name and publicized every Coporation doing business with the government that moved its' headquarters overseas for tax purposes. It is exactly the same thing as this Facebook dude. Do some people get special treatment because of political influence or K Street pull? Follow through and name names.

Ahlevah · May 26, 2012

X Factor said:
The IRS would make the judgment? **** that. Giving the IRS more power is the last thing we should ever do.

It's worse. There would be a legal presumption that the individual gave up his citizenship in order to avoid taxes. He'd basically be guilty until he could prove himself innocent to the IRS's satisfaction.

X Factor · May 26, 2012

Ahlevah said:
It's worse. There would be a legal presumption that the individual gave up his citizenship in order to avoid taxes. He'd basically be guilty until he could prove himself innocent to the IRS's satisfaction.

So much for innocent until prove guilty or that silly notion of due process.

RDS · May 26, 2012

What makes them think he settled in Singapore to avoid taxes? Maybe he prefers to live here and make Singapore his home just like the many Singaporeans who migrate elsewhere. Singapore does not recognize dual citizenship.

ttwtt78640 · May 26, 2012

Nothing to see here folks, please move along. Congress feels that U.S. corporations, such as G.E. may pay no U.S. taxes LEGALLY yet that a private person, that was a U.S. citzen for ten years of his life, must have special targetted tax legislation passed to ensure that "all such" individuals remain U.S. taxable even while no longer U.S. citzens and living the rest of their lives abroad. Of course the 11 to 15 million illegal aliens now within our borders are just peachy, in the eyes of this same congress, and the federal gov't may continue to demand that the states provide every possible form of taxpayer supported assistance to them. Yes they can!

RDS · May 26, 2012

There is better balanced coverage here:

In a statement on Thursday, Mr Saverin insisted his decision to renounce U.S. citizenship was 'based solely on my interest in working and living' in Singapore, and said that he would fulfill all his tax obligations. 'As a native of Brazil who immigrated to the United States, I am very grateful to the U.S. for everything it has given me,' he said. 'I will continue to invest in U.S. businesses and start-ups, and believe and hope that those investments will create many new jobs in the U.S. and globally.'

Read more: John Boehner backs law forcing Eduardo Saverin to pay U.S. tax | Mail Online

'To be fair, Eduardo wasn't born in the U.S and has really lived internationally for most of his life,' said Ben Mezrich, author of the book on which Oscar-winning film The Social Network was based.

Read more: http://www.dailymail.co.uk/news/art...duardo-Saverin-pay-U-S-tax.html#ixzz1vzLLuzFR

RDS · May 26, 2012

lpast said:
Until china decides to send the military and take him and all his money...lool....who in their right mind wants to go live in communist china...he has no intention of spending the rest of his life there...
This guy was a citizen elsewhere...became a citizen of the usa made gadzillions now wants to go to china to avoid taxs...hes a whore...and deservies NOTHING...he knows patriotism to nothing and no country hes an opportunist mutt who deserves what he gets...bar him from ever setting a foot on our soil again.

Go live in communist China? Reminds me of Sarah Palin.

Redbeard · May 29, 2012

lpast said:
Until china decides to send the military and take him and all his money...lool....who in their right mind wants to go live in communist china...he has no intention of spending the rest of his life there...
This guy was a citizen elsewhere...became a citizen of the usa made gadzillions now wants to go to china to avoid taxs...hes a whore...and deservies NOTHING...he knows patriotism to nothing and no country hes an opportunist mutt who deserves what he gets...bar him from ever setting a foot on our soil again.

Came in on this late, but what does China have to do with this? You do realize Singapore is in Malaysia, not China.

Eduardo Saverin Bill Backed By John Boehner

Luna Tick

Opteron

Well-known member

Luna Tick

Opteron

Well-known member

AdamT

washunut

AdamT

American

Trump Grump Whisperer

upsideguy

Pragmatic Idealist

Kreton

Doesn't know

Tigger

washunut

Ahlevah

MKULTRABOY

Wake

Wake

X Factor

Anti-Socialist

DaveFagan

Iconoclast

Ahlevah

X Factor

Anti-Socialist

RDS

ttwtt78640

Sometimes wrong

RDS

RDS

Redbeard